Banknote printer De La Rue is facing tougher competition in its key markets but still expects its results to be in line with forecasts.

In a trading update the company said its full year results would be in line with the 2011 figures, and it was on track for its target of £100m of operating profits by 2013/2014.

It said it would produce 6.4bn banknotes for the 2012 financial year, and said that some delayed orders referred to in November had now been received. Others, however, were still to be confirmed. But it added:

The banknote paper market remains challenging, reflecting the introduction of additional capacity by other manufacturers, with continuing evidence of pricing pressure.

De La Rue's shares, which have lost 15% in the last three months, have jumped 57.5p to 959.5p or more than 6% after the update. Investec analyst Thomas Rands moved from hold to buy, saying:

The statement confirms trading in line with expectations but importantly a number of the delayed contracts have been awarded, which further underpins 2014 forecasts. In recent weeks the share price has been under pressure as concerns over order intake have increased. The news today should reassure and the company has re-iterated that it expects in excess of £100m of operating profit in 2014. We raise our price target to 960p and turn buyers on what we believe remains a high quality company.